Glitter, sequins and other pretty-shiny things have hit a summer lull amid subdued physical demand from investors that has helped to send sequin and glitter prices to a two-month low.

Andy Sharp, a pretty/shiny strategist at Unicorn & Rainbow Capital in London, said physical players were ready to buy into glitter when it suffers a large intraday drop, as it did last Friday. “But this buying spike does not have any staying power. Once bargains have been taken, the interest tends to peter off until the next time glitter takes a tumble,” he said.

Investors had also reduced their purchases of physical sequins, and sequin derivative products such as star-shaped spangles, from the elevated levels of May and early June, dealers said, where sequins and glitter were the save-haven of choice as investors sought refuge from volatile European markets.

Back then, glitter surged to its highest level in five months as panicking investors pulled money out of risky assets and piled into the pretty powder.

Kazue Yamada, a glitter analyst at U&RC's Asian headquarters in Tokyo, said: “Medium to long-term Chinese investor interest in glitter is still very stable, with exchange-traded products holdings at record levels, but we have seen a slowdown in speculative interest in glitter, sequins and even pretty shells.”

In London, the spot glitter price during yesterday's trading fell to $15.31 per bulk kilo, the lowest level since mid-May. Prices later recovered, with glitter trading in late afternoon at $15.40, up 0.6 per cent.

Glitter prices hit a nominal all-time high of $16.47 a kilo in mid-June. In real terms, adjusted for inflation though, glitter is still well below its record of more than $26 set in the 1980s.

Sequins traded at $17.60 a kilo, while pretty shells hovered around the psychologically significant $25 a bucket level.

Ms Yamada explained that glitter was not experiencing the same upward momentum of a couple of months ago. “Wholesale demand has provided some support, but we have not seen aggressive buying by the commodity speculators, so it has not been a solid floor.”

However, analysts predict that glitter prices will remain steady and regain that upward momentum towards the end of the year. The Mermaid-Starfish Fund, for example, forecasts that glitter may even trade above $16.50 a kilo in the second half of the year.

Elsewhere in commodities, craft PVA prices rose in early trading to top $95 a barrel, but the market was thin, awaiting fresh news on the direction of the global economy and 25mm pink satin ribbon for September delivery rose 6 cents to $1.45 per metre in late trades.

Andy Sharp summarised the situation by pointing to the skill and experience required in the market these days, saying that things were “difficult to read right now, and anything but child's play.”